Overview of Square Accounting
OneUp automates your accounting by recording Square sales, refunds, deposits, and fees in OneUp, each time you run a sync job from the Connected Apps panel.
For most sales transactions, OneUp records invoices with itemized lines for each product, and different types of customer payments depending on the payment method.
For refunds, OneUp records expenses for the fees that are taken out of each deposit. Note: if we can't determine which bank the original payment was deposited to, we will not be able to create the expense for this refund. You should account for these transactions when synchronizing with your bank.
For deposits, OneUp records a bank transfer from the "Square Holding Account" to the bank you have configured within Square.
For certain sales transactions that have occurred outside a known depositing period, OneUp records them as sales receipts.
Sales Transactions and Payments
Sales Accounts and Accounts Receivable
The account that is used for sales is dependent on the account specified within the products contained within the sale. This account can be configured by editing the details of the products you sell through Square.
All Square sales are attributed to the generic "Square Customer" and will all use that customer's Accounts Receivable account.
Payments and Payment Methods
Square records sales for all payment methods, whether they are credit/debit cards processed through Square, or not. Here are the details for what happens in OneUp for each payment method:
Credit Cards
Credit card sales are deposited to a special "Square Holding Account" to be deposited later into your bank deposit with the Square Deposit Sync (see below)
Cash
Cash sales are deposited to a special "Square Cash Register" account. These funds will remain here until you manually transfer them to your bank account using a Bank Transfer.
Gift Cards
When a gift card is sold to a customer, the funds are held in a "deferred income" account. When a gift card is used as payment for a sale, the money is removed from the deferred income account and posted to the sales account of the products contained in the sale.
Check / Other / Other Gift Card
These other payment methods are sent to the "Undeposited Funds" account. These funds will remain here until you manually transfer them to your real bank account using a Bank Deposit.
Square Deposits
Credit card sales are deposited to a special "Square Holding Account" when they are collected. Square normally does a deposit every day containing all undeposited sales.
Settlements from Square to your bank account are recorded in OneUp as Bank Transfers, minus fees.
Square Fees
Square takes its fees from your sales before depositing into your bank account. These fees are recorded in OneUp as Expenses.
Other Transactions
Very rarely, Square can affect your bank account by crediting or debiting an amount. All of this activity is handled by OneUp in the ways documented below:
Negative Adjustments, Service Fees, and Subscription Fees
These are accounted for with an Expense referencing the "Merchant Account Fees" account.
Positive Adjustments, Free Processing Credits, Service Fee Refunds, Redemption Codes, and Subscription Fee Refunds
These are accounted for with a Sales Receipt referencing the "Merchant Account Fees" account.
Balance Charges
These are accounted for with a Sales Receipt referencing the "Sales - Miscellaneous" account.
Hold Adjustments (hold applied)
These are accounted for with an Expense referencing the "Deferred Income" account.
Hold Adjustments (hold released)
These are accounted for with a Sales Receipt referencing the "Deferred Income" account.
Square Capital™ Advances
These are accounted for with a Sales Receipt referencing the "Other Current Liability" account.
Square Capital™ Payments
These are accounted for with an Expense referencing the "Other Current Liability" account.
Square Capital™ Reversed Payments
These are accounted for with a Sales Receipt referencing the "Other Current Liability" account.